President-Elect Trump: What Does It Mean for Small Business?

Donald Trump was elected to be our next president here in the United States. This fact brings up interesting scenarios and questions regarding the small business world. Trump, as a business magnate, likely has a plan in place to protect and increase revenue for large corporations, but is he thinking about the small to medium sized businesses?
According to an article from Forbes, Trump would provide a unified business tax rate of 15 percent, meaning not only would corporations pay tax at that rate, but all business incomes, including S corporations, partnerships and sole-proprietorships will be subject to the same 15 percent rate. That is obviously an astronomical decrease from the current rate of 39.6 percent. The article also states that under the Trump plan, the difference in top tax rate between being paid as an employee (33 percent) and paid as an independent contractor (15 percent) is huge. This may cause more people to want to freelance or consult instead of being a full-time employee.
So, community, I am reaching out to you. What do you think of this? Is this plan sustainable, or will such huge tax cuts cause another recession? Will Trump's plan help small businesses? Overall, what does a Donald Trump presidency mean for SMB owners? What about the healthcare issue, as Trump plans to repeal the Affordable Health Care Act?
Although this is a political thread, please try to refrain from pushing your political beliefs on each other, and focus on answering the questions posed in the thread.
To read the full Forbes article, click the link: http://www.forbes.com/sites/anthonynitti/2016/11/09/president-trump-what-does-it-mean-for-your-tax-bill/#3b0bd0d54b8b
According to an article from Forbes, Trump would provide a unified business tax rate of 15 percent, meaning not only would corporations pay tax at that rate, but all business incomes, including S corporations, partnerships and sole-proprietorships will be subject to the same 15 percent rate. That is obviously an astronomical decrease from the current rate of 39.6 percent. The article also states that under the Trump plan, the difference in top tax rate between being paid as an employee (33 percent) and paid as an independent contractor (15 percent) is huge. This may cause more people to want to freelance or consult instead of being a full-time employee.
So, community, I am reaching out to you. What do you think of this? Is this plan sustainable, or will such huge tax cuts cause another recession? Will Trump's plan help small businesses? Overall, what does a Donald Trump presidency mean for SMB owners? What about the healthcare issue, as Trump plans to repeal the Affordable Health Care Act?
Although this is a political thread, please try to refrain from pushing your political beliefs on each other, and focus on answering the questions posed in the thread.
To read the full Forbes article, click the link: http://www.forbes.com/sites/anthonynitti/2016/11/09/president-trump-what-does-it-mean-for-your-tax-bill/#3b0bd0d54b8b
Ryan O'Bleness
Community Manager
StartupNation, LLC
Community Manager
StartupNation, LLC
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Is there any reason why an employer would be hesitant to do this so I have a counter-argument?
I suppose it depends on your working situation. Surely, there are still advantages to being a full-time employee -- salary, benefits, bonuses, paid time off, etc. I am also sure it's at the employer's discretion whether or not he/she would allow a full-time employee to make that transition because they more likely need a full-time employee at the position, or they would not have had one in the first place. The tax benefit would be huge if Trump's plan passes, but I am not positive it outweighs the value of the aforementioned perks of being a full-timer.
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Startups very well could have a higher success rate with the the new tax cuts -- if Trump's plan passes -- but it is also makes me wonder if that drastic of a tax cut would cause another financial crisis.
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Having said that, I think as he comes from a business background, it seems logical that he will be for helping businesses by lowering taxes. I'm sure it'll be hell on social programs, but there should be boosts in startup rates and successes.
Thanks for your input, Bernard.
Trump is a business tycoon, so I agree with you that his business background and expertise will prove to be beneficial. The big questions are A.) will his plan only benefit the top one percent, or will it help out the small guys as well, and B.) how will such drastic tax cuts affect the economy as a whole?
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Honestly taxes are not very high on my list of concerns. My first concern is health care, we need to get costs down on health care and I'd love to see national medicare access with private on top of that similar to other countries. The costs can't keep going up as it is so expensive as a business owner and takes so much money from employees too. And, I am more concerned about unfair regulations that tend to make it hard on the small guy, but let the big guys get away with everything.
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Valid points. regarding health care, Trump has a detailed seven-point plan on his website: https://www.donaldjtrump.com/positions/healthcare-reform.
Note, however, that the first thing on the to-do list is to completely repeal the Affordable Healthcare Act, AKA Obamacare. However, Trump has recently made comments saying he would consider keeping certain aspects of Obamacare. What those aspects are, I am not sure. Insurance prices for Obamacare are expected to go up 25 percent in 2017. I do believe Trump is going to have to find a way to work to keep that from happening, especially if he is now considering keeping aspects of the current system. Also, if he does end up repealing the entire act, I wonder how long that would take to accomplish. With a Republican majority, things could move quickly, but that remains to be seen. I completely agree that insurance costs need to go down for both the business owners and employees. My question is can Trump actually accomplish this while also cutting business taxes significantly? How will this impact the economy?
Again, I don't want this thread to become too political, and I certainly don't want to take a side, but if he does continue to flip-flop on issues he promised his voters, before he is even officially in office, that may not bode well for him, either.
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Ya the root of the problem is:
1. Health care costs too much and is going up faster than inflation.
2. Drug companies have government given monopolies, but we can't negotiate prices on drugs for them on a mass scale.
I don't care what politicians call it, but we need to do something about those two facts.
Thanks, Ben
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Well said. Thank you for your input.
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Well said. Thank you for your input.[/quote]np, just frustrated
I tried to find a graph to paste in here, but basically it did a pretty good job illustrating that any health care dollars companies put into their team, basically was coming out of wage increases for the team. We pay 100% of our team's medical, and if that price went down it would give us more money to actually give them raises.
We tried to inform our team of this by every year showing them on their raise review how much of their x% raise went to health care raises. Hopefully that helped them make educated decisions...
Thanks, Ben
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The election season itself was essentially a circus, but again, I am trying to stray away from providing my political opinions. I agree with you, though. Policies and issues were not really focused on by the media during each candidate's campaign and that can be a problem for not only business owners, at any level, but the American people as a whole. In all honesty, some of Trump's ideas on things like health care, business tax, child care, etc. are actually pretty solid. However, we heard very little about what these plans, policies and regulations actually were, and instead, we only heard about the next scandal each candidate had to try to convince us didn't happen. This may have also contributed to the lack of people voting in 2016. I've honestly never seen anything like it during a presidential race.
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